Statesmanship abroad, prosperity at home

By JIM HOAGLAND, SYNDICATED COLUMNIST

Published 10:00 pm, Tuesday, September 17, 2002

NEW YORK -- Frustration stains the voice of Prime Minister Junichiro Koizumi a melancholy hue as he drones on about Japan's ailing economy and the vested interests that have strafed and bombed his now-tattered reform program. Then we are into foreign policy and this canny politician is suddenly alert, assertive and assured.

"Yes, President Bush did tell me to be careful in going to that 'axis of evil' country," says Koizumi, who on Tuesday became the first Japanese prime minister ever to visit North Korea. "But he also told me to be sure to let him know everything I did and saw there. He was very interested, not negative."

Call it Koizumi's fate or the latest outbreak of the global inverse ratio of statesmanship abroad to prosperity at home. As economies falter and resist government stimulus or jawboning, presidents and prime ministers discover that they are needed elsewhere to work on strategic problems of war and peace. Economic deficits produce diplomatic surpluses -- and sometimes pleasant surprises.

Richard Nixon toured the Middle East as a "man of peace" when the economy stumbled under him. Jimmy Carter had more luck with Arabs and Israelis than with inflation: A top Carter aide assured me in the summer of 1980 that Americans would never vote out of office the man who had just produced the Camp David treaty. Today Gerhard Schroeder seeks victory in Germany's Sept. 22 elections by reassembling the German "peace camp" rather than talking about his dismal economic record. Iraq drove Enron out of George W. Bush's news conferences this summer.

Koizumi and I met in New York last week shortly after his conversation with Bush on the sidelines at the U.N. General Assembly. The two comfortably hashed over strategic options in the war on terrorism and global security. Gone was the hectoring by the Clinton White House for the Japanese to do something about the yen, interest rates or the price of rice to get the economy to revive. They didn't, and it didn't.

Japan has been unsuccessfully fighting off deflationary pressures for 11 years. When I reminded Koizumi that his late predecessor, Keizo Obuchi, described the '90s to me as "a lost decade" for Japan, the prime minister frowned.

"Is it right to speak of those years as 'lost'? I don't like that expression. These were years during which reform lagged, in which people postponed addressing reform," Koizumi said slowly. "We did not change the ways that worked before. They made us take our affluence for granted."

Obuchi thought he could spark economic renewal by making Japanese consumers more optimistic. He died trying. His successor, Yoshiro Mori, told me that a kamikaze or divine wind of information technology would blow Japan back on course. He was driven from office in early 2001 for such simplistic thinking. Koizumi is more careful, saying somberly that "there is no quick fix."

He took office in April 2001 with unusually high ratings in the public opinion polls. After Mori's inept and scandal-plagued tenure, the Japanese electorate seemed ready for change, and Koizumi promised to deal with the nation's rotten banking industry. But domestic battles eroded support and his reform program has stalled.

"When you try to reduce subsidies or cut the size of the government -- Japan's is too big -- you run into lobbies and entrenched interests who fight for the status quo. We have to put into place structural reforms to be able to overcome these" blocking forces, he said without detectable enthusiasm.

Koizumi's decision to visit North Korea was as bold as his economic efforts have been cautious. He gestured vividly in explaining what enabled him to make a trip his predecessors never even considered:

"The international situation has changed with the terror attacks of Sept. 11. Second is the worsening economic situation within North Korea. And it is important that the Japanese government has been firm and consistent on all issues. They understand in North Korea that to normalize relations we must raise issues they don't want to hear about."

On Tuesday an increasingly desperate Kim Jong Il met Koizumi's asking price for the visit: a symbolically important confession that North Korea had kidnapped 11 Japanese citizens about 25 years ago and a promise to extend a moratorium on missile tests beyond its scheduled end in 2003. Those concessions unlock talks on diplomatic relations and economic aid.

Koizumi went home able to phone Bush with that important, good news. And able to enjoy at least one day on which his countrymen were not talking only about the lousy economy.